The Importance of Reconciling Bank Statements Each Month

We rely on computers, apps, and machines to do things our parents (or we) used to do by hand.

You may have a mother-in-law who still balances her checkbook after every check she writes. Well, before you tell her not to worry about that step, you may have something to learn from her.

It’s really important to reconcile your bank account each month. When doing so, there are two things to keep an eye out for:

1) Are all your transactions correct?

Even though we trust our computers, they can make mistakes.

And, companies definitely can.

You can get overcharged for something, you can get double charged, refunds you’re expecting can get forgotten, or, worst case scenario, you get fraudulent charges.

It’s so much easier to keep track of your transactions and double check them when you are only reviewing a month’s worth of charges – as opposed to months of charges. Be diligent and consistent.

2) Have all your transactions gone through?

Some charges get stuck pending or even take a while to show up. When this happens, your digital account balance isn’t actually correct.

You don’t want to make a financial decision based on a number that is incorrect.

These principles hold for all your financial and business transactions. It’s important to be involved and aware of what is happening in all your accounts. You’re more likely to catch mistakes or questionable charges when you’re checking every month. Making sure your account stays reconciled regularly and consistently ensures that you have a reliable account balance that can allow you to make proper spending decisions.

You’ll be a better steward of your money when you are evaluating your accounts and expenses regularly.

And, if you want a financial teammate, reach out to us at Culpepper CPA, PLLC.